Saturday, January 05, 2013

It's the jobs, stupid

In December, the economy added 155,000 new jobs. As usual, the private sector job growth was better (168,000), but we lost government jobs (13,000). These are not great numbers. The government really ought to do something about this. And contrary to what many people believe, there is much that the government could do. Unfortunately, the Republicans are in favor of policies that make both the economy weaker and the budget deficit worse. The Democrats have some decent ideas. President Obama's American Jobs Act would help quite a lot. But it is only a start.I don't think that people understand just how big a problem we face. The problem is largely due to the media. While the base unemployment rate was as high as 10%, all we heard about was the budget -- as though that was the most important thing in the world. If it hadn't been for the police abusing Occupy Wall Street protesters, we'd never have talked about jobs. And now, it seems we are back to fretting over the budget again.So how big is the unemployment problem?Here is a graph from the Center for Economic and Policy Research. It shows when the US economy will reach full employment given three different assumptions. Note that even if we add almost twice as many jobs as we have been, we will not be at full employment until the end of 2017. If we add jobs as we have been, it will take until 2025:

What do we get instead of a discussion of the employment situation? We (rightly) get discussion of the Republican plan to destroy the American economy. We get John Cornyn's op-ed saying that it may be necessary to crash the economy to avoid becoming Greece, Italy, or Spain. As Matt Yglesias points out, this "solution" would be "much worse than anything that's happened in Italy or Spain."It is hard to know where the stupidity stops and the bullshit starts. Cornyn, remember, is a Senator, not some idiot Representative. I hope he gets slapped down for this treasonous oped. But I doubt it. Politicoreported on him as though it was just another option for how to run the government. The Dallas Morning Newsdid much the same. And Business Insider, who I would think really ought to know better, reported it as straight news.Meanwhile, the ultimate gauge of the employment system -- total labor force participation -- is flat. It seems that we are no longer going down, but we are making no progress: